Inflation & Off-Site Manufacturing


We don’t need to turn on the news to know that inflation has been on the rise throughout 2022, we can all feel it in our pockets. The latest Eurostat figures put inflation at 8.6% in September, the highest in Ireland for more than three decades, a stark contrast from the average 2.4% recorded in 2021.

And the construction industry is not immune. In fact, rising materials and energy prices have been driving up construction costs since early 2021. According to the Society of Chartered Surveyors of Ireland (SCSI), during the 18-month period from January 2021 to July 2022, construction inflation has risen by a record 22% (the highest increase since the SCSI started to track this figure 24 years ago). In addition to external factors, such as COVID19 and the impact from the war in Ukraine, “high demand over the last year and a half has been compounded by severe labour shortages and rising labour costs”, according to Kevin Brady, Chair of the Quantity Surveying Professional Group in the SCSI.

Resulting from these industry pressures, in particular the shortage of skilled labour and rising labour costs, many have been turning to off-site manufacturing (OSM) and this trend is set to continue. A recent survey by Linesight states that 96% of developers believe there will be a significant increase in OSM over the next two years. A further 65% of developers believe the use of OSM will leave clients with greater cost certainty.

OSM involves taking as many labour-intensive activities as possible off construction sites and into factory environments. A higher quality can be achieved using the calibrated machines, audited manufacturing processes and rigorous testing procedures in factories, when compared to the unpredictable environment that is a building site. And when building modules and systems are delivered to site in modular form, fewer people are required onsite to complete the installation.

Modula specialises in the OSM of modular wiring systems. By means of a parallel processing approach, while the project is being constructed onsite, the electrical infrastructure for the building is being assembled offsite. This approach can reduce onsite labour requirements by up to 75%, as the plug-and-play system allows for a rapid electrical fit out, providing clients with a greater degree of cost certainty at the beginning of the project.

If you would like to talk to us about how OSM could deliver benefits to your next project, please get in touch by email or phone +353 (0)1 455 9472.

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